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tv   Documentary  RT  January 18, 2018 6:30am-7:01am EST

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to some extent in some cases but i don't think so far at least i'm unaware of anybody who saw that that was anywhere nearly as important as the job well i really give you one example my own channel has been r t has been because of its supposed that interference in the american political process and what's interesting about it i know you don't want to discuss politics but i think it has an interesting economic implication because if you limit the way those companies twitter facebook those big multinational multi-trillion dollar companies operate not only in russia but around the world and if they're seen as pliable to political interest american political interests whatever they are republican or democrat. i suspect that that may influence the way big global economies shaping out because it's changing at this very moment don't you think so i certainly agree that there's a risk in that direction i certainly think the degree to which those things have been called upon is already very risky i hope that sort of very soon of course
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where that could become a more general kind of issue that pushes protection of more directions is the bigger danger and as i said i think it comes from other things worth and from that there is one more proposed sanction that was just the in relation to russia and that was switching this country of this with payment system which i think raised a question about who controls the infrastructure for the global economy and that scared the whole lot of people not only in this country but also i know in other countries there are now very busy developing alternative solutions g. thing that question may have an impact on the way global economy develops forward who all of those platforms that facilitate global trade well i think you can buy back around you'd expect me to say the obvious answer is to get so some international organization the i.m.f. because this was system where the group or something controlling those things to a greater degree than they do no i think the alternative will be on for. in the
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sense that if we then end up with different payment systems it can create a degree of uncertainty for trade in for service transactions that would be unfortunate for all of us i think it's a lose lose situation if we go that way you're leading me perfectly to my next question i thought that this kind of dynamic creates a competition not only over the means of production but over the means of trade and we haven't seen that comp kind of competition before it's just such an extent you can essentially take the entire country out of the global system by just pushing the button and bad potentiality is very scary and many people i know you're not in favor of sanctions in general but i think also it creates a very interesting way of how effectively those sanctions can be implemented and my question to you is that we have the best new good system that was designed to address some of those issues to ensure. discriminatory treatment and such do you think that system of base day and age is capable of addressing the issues that
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we're talking the u.n. the world bank the everything internationally is sort of subject to the what the political will of the owners of the system or in the owners of this is two of the nations of the world and in so far as they they fight it in their interest to agree on something i think they could do it whether they will be able to do it whether their political masters will want them to do it is is the important question i think by the way i don't think that any country can push a button and get rid of trade this is far too important to be farmers to political backlash protectionism two point unfortunately perhaps even when it's damaging yes but to talk about cutting off trade i think that is but if you ban banking transactions from a certain country that's effectively what you're doing obviously over time people will be able to find ways around it but that deliver such a blow that i think would be very significant for any given country money is a very fun jubal thing. and i think it will be very quick before people found ways
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around it because as i say it may be damaging it might cut it back but the idea that you could do anything nearly. to the south it is very unlikely i think for ways around it would be found very quickly just to mention an obvious one. somebody here might find somebody in canada or the can of the canadians could deal with the us and come back and you could be sure there are people very citizens of many countries who'd be willing to play that role well rich may not be a such a bad thing after all because at the end of the day what we want is a. system for all not speaking about the bread and with system the soviet representatives did attend that conference they had it in them to shop at the event but they did not ratify the final agreements charging that the institutions that the conference created was. one of the branches over the wall street and i think that is the view that many in moscow still espouse you worry both at the i.m.f. and world bank do you agree with this assertion which is very popular in moscow
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maybe even in beijing that they i.m.f. the world bank are essentially. serving the probably western bias well i think the outcome certainly through the first sixty years of these intuitions is that they serve the interests of most of the world i don't think you could argue with that one i mean we've had you nervous economic growth unheard in the history of mankind most countries have benefited by it some where the know there is those who opened up more benefited more than those less i think that's unquestionable so i don't think that it's a question of that certainly the united states was very dominant it is creation it was after all the country the only country only large country that emerged reasonably prosperous right after the second world war and in that sense it had enormous role in setting up the system that worked as well as it did but in any event how long that will continue and how much it could be after all the u.s. evidence is going down i don't think is gone but it's certainly less than it was other countries have a bigger say and they need to exercise it there. but i still think there's
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a world interest and i served in both institutions and i am an american citizen no point did the americans ever come to me and say you used to say they knew i was an international civil servant i knew i was an international civil servant they had an executive director just as russia does and they're in the executive director was responsible for representing the u.s. interests well professor take a very short break now but we'll be back in just a few moments stay tuned. for. the new global economic war is unfolding in the realm of education the right to education is being supplanted by the right to access education. higher education is becoming just another product that can be pulled from the sold so there's not just about education anymore it's also about running
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a business and what you. could. kind of. want is the place of students in this business model before college i was born now i'm running stream or higher education for the new global economic war. mongers wouldn't you know i mean you don't. seem to be a teacher what did a court to do. what did you not through only ten. may be. left alone they. said. no terminated especially. if you speak french.
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welcome back to worlds apart and former first deputy managing director of the international monetary fund and former chief economist for the world bank professor krueger. one of the issues that was prominent at the time that the brought in the wood system was created which is seems to be pretty divisive today is the issue of trade deficit classes the united states has been on both sides of the debate they're running a surplus before i believe the night and seventy is now running a five hundred billion dollars a year early deficit is that a problem that has a solution at this point of time well first off i don't think anybody worries or which they should not worry about trade they should if they want to worry about anything is probably current account deficits which includes trade in goods and
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services in the decisions especially important right now because the world has shared the share of the world's output the sin services it greece it is growing much more rapidly than trade and trade in services is going to american services are going through there is that in deficit and it's a mistake said that the second point to be made is that by definition the difference between a country's current account purchases and this current account sales is the difference between domestic savings and investment and a current account deficit can be a very healthy thing if you're a rapidly growing economy if you need more productively use more investment then you have domestic save igs south korea for example the one nine hundred sixty seven savings rate when a five or six percent of g.d.p. and investment rate was twenty percent and it was boring the rest of this group fast it wasn't a problem because it had many productive uses when that happens that's fine but either way it is not a problem for the world it's a problem for the country now if you get the exchanged. very wrong which is where
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the i.m.f. comes in the chances are it's come about because of domestic measures that tip this imbalance between savings and investment and then the i and this comes into both parts of it but the important part is the domestic moment but. just absolute figures. they seem to be stunning in the case of the of the united states and it is often the that the trade performance is. a reflection of the disagree with broom of the whole global economy as well as the. balances for the american economy domestically i guess what i'm asking is rather this disagreeably broom has already become an equilibrium of sorts that may stay in place that dressing of which may create more problems than it solves. i was going to graduate school in the one nine hundred sixty s. at the time when there was a dollar shortage and when all of those discussions and all news discussions were of the u.s. dollar shortage and how other countries didn't have enough and how that was
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a permanent equilibrium now who are the other side of the court and i have no doubt that just about when everybody is convinced it will change yet again the american economy is in disequilibrium it is savings there is not are not as great as his investments and so there is a problem there and the united states needs to take measures and the tax reform bill as i understand from what i've seen of it what we could understand of it so far will make things worse stuff better in that regard as i doubt but there is that on the other hand there's another side to that and then see other countries down the chinese have gone some way to rebalancing their economy away from so many exports and that's probably healthy for the world economy the united states and some other countries in europe need to do the same thing on the inside or one side or the other but on the other hand the disequilibrium so far is not that terrible and there is still some time speaking about the dollar the united states there are a lot of benefits from being here is dollar being the top reserve currency but it also makes american goods and services more expensive and ultimately sustains this
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trade imbalance if you had to choose one of the other what would you prefer and can you really choose can your fine tune your economic policy and expand when you can have a desired outcome about the side effects for example aiming for increased domestic production of without strengthening your current well right now the united states economy is a very full employment the only way to get increased production without a lot of inflation will be to get a greater rate of increase of productivity so the idea that you could do it through policy measures that would for example print more money or cut taxes will not have work of the expenditures will not work except to be inflationary pressures and maybe in the very short run a little bit but the longer and consequences will be unfortunate so i don't think it's a question of choice over the longer run the question has to be how do you balance . the real worry i think for the western european countries for japan for china for the united states maybe for russia but i haven't looked at the numbers is that most of us are facing increasing costs of pensions for the elderly increasing the health
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care costs because of the elderly many of which fall in the public purse must there are measures taken to cut fiscal expenditures or raise taxes tax revenue so while we are all facing bigger problems it will be global disequilibrium not one or two countries now you mention the issue of savings and i think this is another factor that stains the current pattern of the american spending that you that people are encouraged to spend more than they're earning that there is no other various the bush tradition of saving up money putting aside trump and his policy is rich i suppose you know they're great. do you think any american administration at this point can promote actively promote policies that would encourage people to spend last and to save more saving more i think is that we're hopeful probably see that in the spending less and that a dad doesn't want presupposing out there not necessarily their vision is for example where you could indeed raise tax revenues in such a way that you cut the fiscal imbalance and that's cutting the deficit so no it
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doesn't need to be on the other there may be things on both sides then that's a choice variable there's still quite a question about that i think the question real choice is not the one you made just of the real choice is whether we do something with the u.s. do something in the near term to start correcting the imbalance or whether we wait until it's even more pressing and we have to take more drastic measures now there are many truisms in economic science and one of them is that markets and economy likes predictability now i think i would agree that trumpeting restoration is possible in the of the most predictable. economy in the american economy is doing fairly well but for which trump is it really taking credit. do you think it's due. and so while because of him or despite him well the economy was picking up before he came into office in all the twentieth century is far from we further back what's happening to the economy this year is not a function only of policies this year but past there was momentum for the upturn
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ahead of time there's no doubt about that and we were already on the path to recovery and certainly nothing that happened in let's say the first six months of this year could very reasonably be attributed to that secondly policy which is the responsibility of the reserve is outside the control of the president we want to dependent it is reasonably so so that again it's not probably there is a little bit of an uptick at the start line or more of an uptick in the stock market because of what the tax law and a few things like that but on the other hand i think there are concerns over the longer term at the moment the markets seem to be very euphoric and they don't seem to be looking at what's ahead but i think there are reasons to be a little more cautious than that. i don't know if you would agree with them but i think the american economy. especially it would be if the starting of history of the american economy poses a very interesting philosophical.